spread order

An order to buy and to sell options of the same class but with different strike prices and/or expiration dates in which the customer specifies a spread between the option sold and the option purchased. For example, an investor might enter a spread order to buy a March call and sell a September call, both on AOL Time Warner and with a strike price of $30, if a spread of $2 can be obtained. The order will be executed only if a floor broker can sell the September call for $2 more than the price at which the March call can be purchased.

With this new offering, clients are able to apply custom filters to identify trading opportunities, evaluate the marketability of their orders and provide more intelligent spread order routing capabilities.

This technology is so sound that we will undertake the risk of any partially executed spread order," said Thomas Peterffy, founder and chairman of Interactive Brokers Group, the parent of global agency broker-dealer IB.

Anticipatory strategies have developed to the point that they can glean the intent of traditional smart order routers, which use "price discovery" to slice and spread orders across multiple venues and over time.

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